Tesoro agrees to pay $1.1 million penalty

Wesley Loy

For Petroleum News

Tesoro Corp. and affiliates including Tesoro Alaska Co. have agreed to pay a $1.1 million civil penalty to resolve a federal enforcement action.

The U.S. Environmental Protection Agency alleged that Tesoro failed to comply with requirements under the Clean Air Act at four of its refineries producing conventional gasoline. The four plants are at Salt Lake City, Utah; Mandan, N.D.; Anacortes, Wash.; and Nikiski on Alaska’s Kenai Peninsula.

Tesoro is the top gasoline maker in Alaska.

EPA said Tesoro failed to comply with certain recordkeeping, reporting, sampling and testing requirements.

The $1.1 million penalty is the largest for these types of violations in the history of the agency’s fuels program, EPA said.

“By taking action against violations of these regulations, EPA is not only protecting people’s health, but is also ensuring a level playing field for refiners that play by the rules,” Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance, said in a May 30 news release.

EPA fuel regulations require that all fuel produced, imported and sold in the United States meet certain standards. This requires proper sampling and testing of gasoline, and submission of reports to EPA, the agency said.

Emissions from motor vehicles continue to make up a substantial portion of all air pollution, and when inappropriate fuels are used, emissions can increase and emission control equipment can be damaged, EPA said.

“The violations at issue in this case reflected a need for better management of data recording, recordkeeping and reporting, laboratory practices, and sampling and testing protocols,” the agency said.

EPA added: “While no known damage to the environment or to human health is associated with Tesoro’s violations, these violations result in programmatic harm that seriously undermines the integrity of the fuels regulations.”

Under a consent decree, Tesoro will implement a systemwide compliance plan covering all of the company’s conventional gasoline production.

The proposed settlement is pending in U.S. District Court in Washington, D.C. It’s subject to a 30-day public comment period and final court approval.

Based in San Antonio, Tesoro is one of the largest independent petroleum refiners and marketers in the western United States. It operates seven refineries, and its fuel retails under brands including Tesoro, Shell and USA Gasoline.